The era of cheap gas in New Jersey is over

Gov. Christie finally gave in. Reuters/Gretchen Ertl Sometimes I just can't believe it. Driving around in New Jersey, where I live, I see what to my mind are comically low gas prices — I can almost always fuel up for less that $2 a gallon.

Two years ago, I moved from one of the highest gas-price states in the US, California, and a year ago, I became a resident of the Garden State.

I'll never forget the first time I stopped at a gas station and, being a decade-long Los Angeles dweller, prepared a pair of twenties, only to get my fill-up for $18.

New Jersey gas is cheap because the state hasn't raised its gas tax since the 1980s. But now Governor Chris Christie, following a horrific New Jersey Transit train crash in Hoboken last week, has finally relented in his no-tax-hikes agenda and accepted a $0.23-a-gallon increase to replenish the state's transportation fund and do something about the dilapidated condition of bridges, tunnels, mass-transit, and roadways.

There was of course some political horse-trading thrown in, as New Jersey Democratic leaders agreed to lower the sales tax slightly and to end the estate tax in a few years.

I have to admit that I'm torn by this news. On the one hand, there's no question that New Jersey's infrastructure problems must be addressed and that a gas tax is a quickest way to generate the revenue. But on the other, I was shell-shocked by paying for gas in California all those years; the Golden State is often described as "gas island" because its fuel is so different from what the rest of the country uses, due to environmental regulations and an ancient refining industry.

Onlookers view a New Jersey Transit train that derailed and crashed through the station in Hoboken, New Jersey. Courtesy of David Richman via Reuters

Borrowed time

Jerseyites were clearly living on politically borrowed time.

Thirty years without a tax increase for such an obvious fund-raising mechanism didn't make much sense, and the anger of affluent suburban commuters to New York, saddled with endless rail delays, was going to become a liability for Christie's successor, Republican or Democrat.

This could have a modest effect on auto sales, as well. SUVs are very popular in New Jersey, but their comeback in recent years has been driven by cheap gas.

I have a hybrid that I drive mainly on weekends, so I'm already hedged against a jump in fuel costs. But if you're accustomed to gassing up your Chevy Suburban for about $60, adding a quarter more a gallon could make you think twice about buying another vehicle so large.

OK, it's only about a quarter more a gallon, but New Jersey drivers could soon be hit with another gas tax, if the federal rate is increased; it hasn't be raised since 1993.